Scottish Budget 2026 to 2027

Annex D – Scottish Government Operating Costs

Overview

The total operating costs for the Scottish Government comprise portfolio operating costs, which include core Scottish Government staff and associated operating costs incurred directly by each portfolio, and corporate running costs which are more efficient to deliver centrally, such as digital, estates, procurement, finance, legal services, and HR. In line with public service reform, many of these central services are also provided to over thirty public bodies beyond the core Scottish Government.

Portfolio operating costs are aligned with the portfolio budgets they support. The Scottish Government’s corporate running costs budget and corporate capital projects budget form part of the Finance and Local Government Portfolio, providing greater transparency on the operating costs of government.

Through the operating cost budget, we are ensuring that the organisation has the capacity and capability to deliver the priorities set out in this Budget. To achieve this, we continue to strengthen financial controls to improve transparency and governance, ensuring budgets are aligned with deliverable plans.

We are investing in systems and approaches that enable better public services in a fast-changing and complex environment, while driving efficiencies so resources are focused on frontline delivery. Improving effectiveness across government and public bodies remains central to Public Service Reform and is a key pillar of our approach to fiscal sustainability. These changes must be delivered in a way that protects public services and supports the Government’s priority missions.

Scottish Government Workforce

In recent years, Scottish Government workforce numbers have begun to reduce in line with our commitment to fiscal sustainability and public service reform. Enhanced recruitment controls, introduced in April 2022, remain in place to ensure resources are deployed flexibly and focused on priority areas. These measures support an efficient and effective workforce while protecting frontline roles.

Workforce planning continues to align with the targets set out in the Public Service Reform Strategy and the Fiscal Sustainability Delivery Plan, including a phased reduction in operating costs and workforce over the coming years. We are working collaboratively with staff representatives and stakeholders to deliver these strategic aims and ensure the organisation plays a leading role in reform.

Alongside workforce reductions, we are prioritising improvements in capability and systems to support modern ways of working and deliver better outcomes for the people of Scotland. Workforce numbers are regularly published as part of the Scottish Government Workforce Information publication.

Scottish Government Operating Costs

The total operating cost budget for the Scottish Government in 2026-27 is £811.7 million. This represents 1.2% of the overall Scottish Budget (as measured by Total Managed Expenditure). Total operating costs are summarised in Table 1 below.